Journal - 10/26/04

A disastrous day. First, missed big profits on a great buying opportunity on ER2 at extreme oversold level. Then, emotionally kept shorting a strong short squeeze rally. Wiped out several days of hard earned profits!

Trade 1

10:11 - S ER2 2 @ 570.5 - 10m sideways, pb20ema/pivot
10:12 - Exit 2 @ 571.1 -12 ticks - stop hit

Note: Trade stalled here a bit but never got down, market not proving trade correct so should have exited when it started to move against me. Have to work on reacting when market tells me I'm wrong!

Trade 2

10:13 - S ER2 2 @ 571.0 - no real reason here, emotional entry after 1st loss, entered above 50ema (bad trade)
10:15 - Exit 2 @ 571.6 -12 ticks - stop hit

Trade 3

10:16 - S ER2 2 @ 571.3 - price stalled a bit here, was thinking short covering over, still emotional (bad trade)
10:19 - Exit 2 @ 571.7 -8 ticks - exit at market as price remained negative

Note: Exit was good, market not proving trade as correct. However, should not have entered in the first place because no reason/setup!

Trade 4

10:21 - S ER2 2 @ 571.6 stp -8 - another emotional trade, still insisting short, no reason to short as price has not made a lower low yet on the 10min (bad trade)
10:24 - Exit 2 @ 572.4 -16 ticks - stop hit

Note: Emotion clouds judgement. My stop was 8 ticks. I never enter with that wide stop (risk). R/R here was very bad and no good reason/setup to enter.

Trade 5

10:51 - L ER2 2 @ 571.2 stp 3 - 10m sideways, at lower BB/emas support
10:53 - Exit 1 @ 571.8 +6 ticks - scale out, at middle of band
10:54 - Exit rem 1 @ 571.5 +3 ticks - price could not brk middle band, looking weak

Note: This was the only logical trade made today with good reason/setup and good R/R.

Comment: Disastrous day caused by trading without a valid price action entry and setup. Emotional trading is the cause of most of my disastrous days. My trading strategy/plan works, but if I deviate from it, disaster looms!

The lesson is trade within the plan!